Domestic markets trade in fine-fettle in early deals; Services PMI eyed

Indian equity benchmarks made gap-up opening on Monday tracking gains in global peers. Markets extend their gains and are trading in fine-fettle in early deals on account of healthy buying in Consumer discretionary, Realty and Auto stocks. Sentiments got a boost as India recorded the highest-ever exports of $95 billion during April-June, up 85 per cent Y-o-Y and 18 per cent higher than the first quarter of the fiscal year 2019-20. The merchandise exports grew 47 per cent Y-o-Y to $32.46 billion in June, driven by a robust demand of engineering goods, petroleum products, and gems and jewellery in the external markets. Addition more optimism, Union Finance Minister Nirmala Sitharaman said that the government has been proactive in responding to the challenges caused by COVID-19 and is also taking up substantial reforms despite the pandemic. Besides, in reversal of a two-month selling trend, foreign portfolio investors (FPIs) in June turned out to be net buyers by investing Rs 13,269 crore in Indian markets. On the economic front, the Markit Composite PMI and Markit Services PMI (June) readings to be announced later in the day.

On the global front, Asian markets are trading mostly higher on Monday, following the broadly positive cues from Wall Street on Friday as upbeat US monthly jobs data renewed optimism about strong economic growth and outweighed concerns about inflation. Investors are also cautious after a recent spike in coronavirus cases across several markets in the region that has led to lockdowns and restrictions in some major areas. Back home, infrastructure stocks were in focus as NHAI said toll collection in June 2021 increased to Rs 2,576.28 crore, 21 per cent higher than Rs 2,125.16 crore collected in May this year, with the easing of lockdown in most states and rise in the traffic movement on the highways. In scrip specific development, Panacea Biotec jumped after it received license to produce Sputnik V vaccine in collaboration with the Russian Direct Investment Fund.

The BSE Sensex is currently trading at 52786.21, up by 301.54 points or 0.57% after trading in a range of 52604.35 and 52821.35. There were 28 stocks advancing against 2 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.30%, while Small cap index was up by 0.67%.

The top gaining sectoral indices on the BSE were Consumer discretionary up by 1.07%, Realty up by 0.99%, Auto up by 0.91%, Consumer Durables up by 0.84%, Bankex up by 0.75%, while Power down by 0.35% was the sole losing indices on BSE.

The top gainers on the Sensex were Bajaj Auto up by 1.61%, Asian Paints up by 1.23%, Axis Bank up by 1.17%, Larsen & Toubro up by 1.16% and Maruti Suzuki up by 1.05%. On the flip side, Tech Mahindra down by 0.41% and Dr. Reddy's Lab down by 0.30% were the only losers.

Meanwhile, Commerce and Industry Minister Piyush Goyal said India has set a target of $400 billion merchandise exports for 2021-22 (FY22).  He mentioned ‘In collaboration with private industry, MSME sector, engineering, agriculture, automobile, steel sector, we have set an export target of $400 billion. We all will work together to achieve this target.’ Further, he said India's economy is growing and exports are also growing.

He stated India recorded the highest ever exports in the first quarter of April-June 2021. The highest ever merchandise export in a quarter of $95 billion has been achieved from April to June despite the severity of the second wave of COVID-19. He added ‘Despite COVID-19, we have achieved the highest ever FDI inflow of $81.72 billion in 2020-21. FDI inflow of $6.24 billion in April 2021 is 38 per cent higher than in April 2020.’

Besides, he said startups recognised by the Department for Promotion of Industry and Internal Trade (DPIIT) have gone up to 50,000 across 623 districts. He said ‘with these startups nearly 1.8 lakh formal jobs have been created by over 16,000 recognised startups in 2020-21. Several times more have benefited from the startup ecosystem. We have established a fast track mechanism for granting patents to the startup sector.’ He said there are enough avenues of facilitation without giving subsidies. India has competitive advantages and also offers comparative advantages for the world market.’ Referring to e-commerce policy, he said the government has recently announced e-commerce rules under the Consumer Protection Act.

The CNX Nifty is currently trading at 15814.10, up by 91.90 points or 0.58% after trading in a range of 15762.05 and 15820.05. There were 43 stocks advancing against 7 stocks declining on the index.

The top gainers on Nifty were Eicher Motors up by 2.04%, Bajaj Auto up by 1.66%, Hindalco up by 1.64%, Asian Paints up by 1.25% and Axis Bank up by 1.18%. On the flip side, HDFC Life Insurance down by 0.65%, Tech Mahindra down by 0.53%, Cipla down by 0.40%, Dr. Reddy's Lab down by 0.28% and JSW Steel down by 0.19% were the top losers.

Asian markets were trading mostly in green; Straits Times gained 8.96 points or 0.29% to 3,137.91, Taiwan Weighted surged 180.20 points or 1.02% to 17,890.35 and KOSPI added 11.74 points or 0.36% to 3,293.52 and Shanghai Composite was up by 5.54 points or 0.16% to 3,524.30. On the other hand, Nikkei 225 declined 172.10 points or 0.60% to 28,611.18, Hang Seng fell 147.82 points or 0.52% to 28,162.60 and Jakarta Composite lost 27.86 points or 0.46% to 5,995.15.